As one of the first legal artificial intelligence (AI) solutions to the market, you might think that Kira has seen it all. But 2018 held some remarkable firsts for the company. From receiving a $50 million investment to partnering with HighQ, it was a big year, and in some ways just the beginning.
We recently sat down with Andrew Jardine, Global Account Director at Kira Systems, to discuss artificial intelligence (AI) for corporate legal teams, what everyone should know about AI and what the future holds.
HighQ: Thank you so much for joining us today, Andrew. To start, would you tell us a little bit about your background and role with Kira Systems?
Andrew: Glad to have the opportunity to talk with you. I serve as the Global Account Director at Kira Systems. I work with corporations deploying our AI solutions.
I've been with the company for about three years. I joined when we were a much, much smaller company. I was around their 30th hire. We're close to 150 people today. We have grown very quickly, and I've been here for most of that.
Back when I joined, we really were only selling to law firms. We just had a few of our first BigLaw firms join, including Freshfields and Clifford Chance. It was a very exciting time of growth.
At that time, Kira Systems didn't have many customers or experience in the corporate space yet. I had a background in management consulting, working with a range of businesses like banks, insurance companies and general corporations, so Kira Systems brought me on to look at all the opportunities in the corporate space, talk to these businesses and figure it all out. They had a sense that there was a big opportunity out there, but they didn't really know what it was, so I was tasked with finding out how businesses would use Kira Systems and how we could break into the market.
After 12 months of talking to hundreds and hundreds of people, I identified the opportunities for Kira Systems in the non-law firm space, and then started to pursue them.
HighQ: So, after that year of research, what did you discover? What primary AI use cases were identified for corporate legal teams?
Andrew: There are many use cases, but one of the biggest opportunities is with contract lifecycle management tools.
Historically, companies were throwing all of their contracts into vaults and they had no way of accessing that information to use it. They signed the contract, locked it away, and that was it.
Recently, people have been starting to adopt contract management systems—more specifically, contract lifecycle management tools that help from generation to storage to the application of that data. The big opportunity for Kira is that CLMs only work well if they have really good data inside of them.
At its core, Kira is a data extraction tool. So, the biggest opportunity for us in the last few years has been helping to extract data from contracts, both current and legacy, and moving that good data into a database, so corporations can then analyze the data and use it for ongoing management of the businesses.
HighQ: What does a day at Kira Systems look like for you?
Andrew: Every day is a bit different, but I generally spend a lot of time talking to clients. As an organization, Kira Systems is very customer-centric. A lot of my day is spent helping existing clients and supporting them.
When I’m not working with clients, I spend time with our product and marketing teams. I share feedback and insight from clients, so our teams can build that knowledge into the product as well as communicate its value.
There's always also a ton of stuff going on at Kira Systems. Every day is something weird and new and wonderful. A few weeks ago, we went to play trampoline dodge ball. A few weeks after that, we decorated ugly Christmas sweaters. There's always something interesting going on in the office, and I enjoy participating in those events as much as I can. It's a really neat place.
HighQ: What do you wish people knew about legal AI?
Andrew: I wish people knew that AI is not a silver bullet. It is not going to solve all of your problems overnight and do absolutely everything for you, but there are still huge potential benefits.
There are people who think, "AI can do absolutely everything for me." But then, because their expectations are so high, when we explain the limitations of the technology, they think, "Well, what's the point of having it at all?"
It can still do a lot of things and reduce the amount of work you are doing. I wish people would have a more tempered view, I guess, of legal AI. If they did, they would be able to get a lot more out of our technologies, because you need to pair up humans with the machine. If you combine our technology with existing human processes, the sum of the two parts is much greater than they are individually.
HighQ: How does the use of AI differ between corporate legal departments and law firms? Are they both using AI to complete the same tasks or are they completely different?
Andrew: There’s a bit of overlap, but not too much. Generally, the work that corporate legal departments are doing is quite different from the law firms. We can break the use cases down into two buckets.
One bucket is business-as-usual contract review and the other is projects. Now, corporations do both, but they tend to lean more heavily towards the business-as-usual side of things.
In business-as-usual contract review, there are really two areas where Kira has been helping. One is when a contract is coming in and you want to sign it and potentially negotiate it. For that use case, Kira Systems’ AI solution identifies and extracts information from a contract to help you review it more quickly. Then, if you wanted to negotiate it, you could do that with one of our partners. That's the first business-as-usual use case.
The second use case is, once you've signed that contract, you want to onboard that data. What does that mean? It means collecting simple information like the parties to that contract, some of the clauses, the date, and putting that information into a database. People want to onboard their contract data, so they can come back and query it at any time.
For instance, you’re in the banking space, helping clients collect information on NDAs, then someone in the front office can quickly check, "Do we have an NDA with this person?" Or they could also do a conflict check. That's a simple task, but it is something that a lot of businesses really struggle to do, but Kira can help make a lot easier. Those are the two business-as-usual use cases.
The next use case, our second bucket, is on the project side. These are one-time projects that include different types of contract review and migrating legacy contracts.
The contract review projects we see most are merger and acquisition (M&A), diligence, regulatory and LIBOR. An example of diligence contract review is divesting your business or an IPO. M&A can broadly be called transactional contract review. Regulatory contract review looks for compliance issues to determine if they need to be “repapered.” GDPR was a recent example. And LIBOR is probably the next big one that's coming up for banks. Many banks are going to have to review hundreds of thousands of contracts for LIBOR language to determine if they must amend them.
For a project migrating legacy contracts to a contract database, a business may take up to 30,000 contracts, extract the legacy data, and push that into a database. The historical data can then be used to improve future business decisions. We help with that.
HighQ: What would you say is the biggest hurdle for wider adoption of AI in corporate legal departments?
Andrew: The biggest barrier to adoption is the amount of market hype. There are a lot of vendors out there overhyping what their tools can do. It distorts the market, so expectations are misaligned.
Sometimes the expectation of what the tool does are totally wrong. Then when we engage with a potential client to explain the value of the tool, their expectations are so far away from reality that it’s a journey to help them understand what is actually achievable.
Then whoever is championing AI within in their business has to go and explain it to the executives on their side and other business stakeholders. All those people might have read one or two articles or spoken to one or two vendors. If the messages they got were misaligned, then it creates a mistrust or a bit of confusion, so it makes it hard.
The level of understanding in the market can make adoption harder on a broad scale. But I've definitely seen that improve over the last year or so.
HighQ: This year was a big year for Kira Systems with the announcement of the $50 million investment as well as the partnership with HighQ for the launch of the AI Hub. What's next? What can our joint clients look forward to in 2019?
Andrew: We have a lot of plans. We are going to be doubling down and really investing further in the things that we were already good at. Our company philosophy is about doing one thing and doing that thing really well, and that is using our AI to identify, extract and analyze data. So, we'll continue investing in new technologies with that goal in mind. Hopefully, that will support our ongoing growth and create growth for our partners.
HighQ has been a great partner for us, so we want to continue to build our partnership. We’re expanding other partnerships as well, so we can stay focused on our niche while being able to address wider use cases through our partners.
HighQ: LawGeex recently reported that the total investment in legal AI topped $362 million in 2018. As one of the first companies to enter this market, what do you see as your key differentiator?
Andrew: I think it is exactly that, being one of the first in the market is a great differentiator for us. It takes a long time to understand a new market. Being one of the first players in the market means that we have more experience than anyone else. We have a much better understanding of our clients’ use cases. It also means our technology has been properly tested.
We work with huge global organizations, like Deloitte, that continually challenge us to meet their growing needs. We've had thousands and thousands of users around the world processing millions of contracts. We’ve been working with clients like that for years and have learned how to address their problems over time.
We've been in the market longer, so we have more robust, reliable technology. Our business is larger than almost all the other players in this space, which means we are better at supporting large organizations. We have a dedicated team of lawyers continuously teaching Kira to find new things and find them better. The legal knowledge engineering team has built nearly 700 models that are ready to use right out of the box. We have rolled out technology to law firms with hundreds of users as well as Fortune 500 companies that want to process millions of contracts. You don't get that kind of experience and knowledge overnight.
HighQ: What advice would you give to a GC or a legal ops role looking to select and deploy their first AI solution?
Andrew: I think the first point would be to identify your trusted vendors. Speak to your law firm or speak to your colleagues in similar industries and find out who they've worked with and which vendors they trust.
If you go to the right vendors, they will tell you the limitations of their technology as well as how you can leverage them to get the most out of it. It's important to do that, before setting your requirements, because every single tool will do something a little bit different.
After looking at a few of them and roughly understanding what they do, go back to the drawing board and ask, "What is possible for us to do and what are our requirements?" Then, and only then, move to create an RFP. After that, the third stage, obviously, would be to sign a license agreement with Kira Systems, become a customer of ours.
HighQ: That's the perfect conclusion, really! Thanks for taking some time to talk with us today and help us understand how corporate legal teams are using AI.
Andrew: It was great to talk with you. Thank you for the opportunity.
To learn more about Kira and AI for corporate legal teams, visit kirasystems.com or follow them on Twitter and LinkedIn.